I’m writing to give you some additional information that may help you with your taxes. As you probably know, New Yorkers and others living in high-tax states were targeted in the Trump federal tax bill that was just passed. Some of you may be able to prepay taxes to take extra deductions this year for NY State and local taxes, deductions that are severely limited next year, but you must act this week.
Prepaying taxes won’t help everyone, so ask your accountant if you should do it. If you’re a homeowner, you can consider prepaying your property tax for school and city/town taxes that would be due in early 2018. Also, whether or not you’re a homeowner, if you pay estimated taxes, you could pay your fourth quarter NY State estimated income tax now, rather than waiting until the mid-January due date. Prepayments are more likely to help you if you itemize deductions, pay over $10,000/year in state and local taxes, and don’t pay the alternative minimum tax (AMT).
The City of New Rochelle and the Town of Eastchester have information on their websites on how to prepay property taxes on line, in person, or by mail. Eastchester’s deadline is this Friday 12/29, although on line payments can be made by the 31st.
Unfortunately, 2018 Westchester County property taxes can not be prepaid. Here’s the report from David McKay Wilson in today’s Journal News. http://www.lohud.com/story/money/personal-finance/taxes/david-mckay-wilson/2017/12/26/no-prepayment-westchester-county-taxes/982682001/
And Mike Kaplowitz, Chairman of the Westchester County Board of Legislators, emailed this explanation:
The new tax reform package signed into law earlier this week by President Trump will have a serious impact on your County taxes – namely the capping of the State and Local Tax (SALT) deduction at $10,000. To help combat this bill’s deleterious impact, Governor Cuomo has issued an Executive Order that allows for early payments of some of next year’s taxes.
The County Executive is responsible for getting the tax warrants to the Board of Legislators through the following process: The Westchester County Finance Department computes and creates annual tax billings, known as tax warrants, for the cities and towns in Westchester for the County portion of property taxes. There is one tax warrant for both the County’s general operating budget as well as the special districts budget (water, sewers, etc.), but both must be calculated independently. This Finance Department responsibility is mandated in the Westchester County Charter, and usually they must be prepared by Feb. 1 of each year for submission to the County Executive. The County Executive reviews and approves the tax warrants and submits them to the Board of Legislators who formally enact the yearly tax legislation. The tax warrants are then signed by the Chair of the Board of Legislators and delivered to all cities and towns in Westchester. The cities and towns, per county charter, collect the county portion of real estate taxes and guarantee the full amount to the County.
For prepayment of property taxes, all of this must be in done in the 4 business days remaining in 2017. With the late adoption of the 2018 budget due to the County Executive’s veto and our subsequent override, the Finance Department has even less time to send the tax warrants to each municipality for collection. For cash basis taxpayers, pre-payment has to be made in 2017 in order to claim this deduction. You should always consult your tax advisor on these issues.
Remember – the County portion of your property tax bill is roughly 15% of the total bill you pay. Other local governments in our area — towns, villages, school districts, and so on — are also looking at ways to facilitate prepayment, and many of them have reached out to their constituents. You should check with them to see if you can prepay those taxes. The advisability of prepayment depends on your individual circumstances, so please check with your financial advisor to see if prepayment is for you.
While the ability to pre-pay your 2018 County taxes seems unlikely, the Board of Legislators will remain available until the last business day of the year to process and sign any tax warrants that are sent to us from the Executive branch.
I am very excited to start representing you on January 1, 2018. Happy New Year!